which option is best in between Business Area or Profit
center for generating balance sheet & P/L a/c while using
ECC 6.
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Answer Posted / mk
I think that the balance sheet should be at the company code
level. I see no use of a balance sheet created for a proft
center or even a business area. Balance sheet has items
like equity capital, cash, retained earnings which belong to
the legal entity and not broken up by a business area or a
profit center.
As for P&L statement, they can be created by either Business
area or the Profit Center and depending upon your use of
business area or profit center the usability of either
option can be argued. However, the purpose of profit
centers "is" to determine the profitabilty of a business
operation, a department or even a person. So, a profit
center specific P&L will shed light on the profitability (or
not) of that profit center. That could be useful in taking
decisions such as continuing or discontinuing with that
profit center or trim costs or reorganize resources.
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